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EC Says Meeting 10% Biofuel Obligation Will Consume 15% of Arable Land

14 August 2007

Dgagri
Projected growth in biofuel consumption in Europe under the 10% obligation. Click to enlarge. Source: DG AGRI

Meeting the 10% obligation for biofuel in Europe by 2020 will consume about 15% of the arable land in Europe, according to a recent analysis published by the European Commission’s Directorate-General for Agriculture and Rural Development (DG AGRI). The 15% figure is predicated on the assumption that 30% of biofuel production will be from second-generation processes and 20% of the supply will be imported.

Under the 10% obligation, about 59 million tons of cereals—mostly soft wheat and corn—or 18% of domestic use, is expected to be used for first-generation biofuels, and including straw, also as second-generation biofuels. Even with a projected yield increase of about 1% per year, domestic use of cereals will increase significantly while exports will decline.

The report estimates that the long-term impact of biofuel production on cereal pricing will be in the range of 3-6% compared to 2006 prices.

The projections depend on the rapid development of the second-generation biofuel sector. That, it turn, depends on the future costs of production and speed of development of second-generation technologies to industrial scale and not at least the possible cost improvements in production of first-generation biofuels. Current estimates of costs show that second-generation feedstock are 30% (second-generation bioethanol) to 70% (BTL) more expensive than respective production of first generation fuels under present conditions and prices in the EU. Despite significant unknowns, however, the report assumes a 30% contribution by 2020.

Second generation feedstock yields significantly higher energy per hectare. For example, energy yields per hectare of cereals would increase by 30%-40% if the straw and the grain would be used, according to the report. This results in a reduced land area needs. In addition, non agricultural land can be used to grow energy crops.

A lower, 20% contribution of second-generation biofuel would increase import needs to 30%. The increasing rate of imports would be seen in the oilseed and vegetable oil markets. The import share would reach 50% and agricultural prices would be significantly higher than those displayed in the analysis under a scenario with no production of second generation biofuel.

The report assumes that with tax policies remaining constant, about 55% of the consumption of transport fuel in 2020 would be diesel. Any change in fuel taxation policies in Member States which would swing the preference to gasoline will bear significant consequences for the composition of feedstock demand for biofuel.

In conclusion the 10% scenario does not overly stretch the land availability nor does it lead to a significant increase of intensities of production because of the limited pressure on markets. The long term until 2020 and the relatively small increase in cereal feed use in the EU over that time would leave enough possibilities for European farmers to support this new market outlet without a danger of returning to fertilizer and pesticide input patterns seen until the late 1980s.

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August 14, 2007 in Biodiesel, Ethanol, Europe, Policy | Permalink | Comments (22) | TrackBack (0)

Comments

Some German experts believe they can meet all transport and aviation fuel needs with Sunfuel (or similar), without using too much arable acreage. Gallons per acre and energy balance really are the keys in this issue, so it's algae over oilseeds for me any day.

Posted by: clett | August 14, 2007 at 07:38 AM

If fisher-tropsh like (or other) conversion of biomass to liquid is used, using fast-growing trees, a very cheap feedstock can be obtained with a much higher yield per hectare. Also, since harvesting is done only once every few years and the roots are left behind, the fields have a much higher ecological value than our actual croplands. It seems to me that the only reason why this is not persued more agressively is the lobying of the farming industry.

Posted by: Bengee | August 14, 2007 at 07:55 AM

Can the planet produce enough crop energy to feed 10 billion people + 10 billion ICE vehicles when accumulated energy sources such as Oil, Coal and Gas are used up?

Here are some astonishing figures:

According to Prof. Stephen A. Nelson we currently consume an average of 230000* calories per capita per day.

* This is a world average. North Americans consume many times that.

The food we consume (about 2300 calories per capita per day) accounts (directly) for only 1% of the total.

However, cooking, preparing, serving, packaging, transporting, selling, storing and producing the food we eat (+ all the wastes) is not very efficient and require 30 to 50 times more energy or 80000 + calories per capita per day.

The remaining daily energy consumption, about 150000 calories per capita, is used by our homes, commerce, industries and personnal transportation systems.

Our current ICE gas guzzlers consume the equivalent of about 3000 liters of ethanol each per year or about 8 liters/dy of about 40 million calories* per day.

* One ICE ethanol guzzler consumes enough energy to feed 175 people.

Since the energy required to produce ethanol + crop feed stocks = about 80% of the energy contain in the end product, the world will have to find more efficient ways to produce energy for personnal transport.

We cannot continue to consume 40 million calories per day per vehicle on the road after cheap Oil, Coal, Gas are used up.

Electrification of most mass transport systems and most personnal transport vehicules is an indisputable necessity.

Producing the clean electrical power required can be managed. Wind, Sun, Waves, Geothermal and Nuclear are excellent sources. The essential distribution networks already exist but will have to be updated and optimized.

Posted by: | August 14, 2007 at 10:14 AM

Cellulosic biomass does not harm food production, as long as it made from agriculture waste, forest waste, card bored, waste paper, etc

Posted by: | August 14, 2007 at 12:07 PM

"Since the energy required to produce ethanol + crop feed stocks = about 80% of the energy contain in the end product..."

For the love of god, how many times do people have to restate the same thing we already know about the current methods of producing ethanol? Yes, worst-case estimates seem to peg the EREOI at around your stated level, but most near-future cellulose-based processes are shooting for ratios of 6:1 to well over 10:1. That changes the dynamics considerably (maybe not in comparison to food production, admittedly).

Posted by: Angelo | August 14, 2007 at 02:36 PM

It's important to get through the first stage of biofuel production to begin integration with existing fuel infrastructure. Bad as corn ethanol is, it's priming the pump for much more sustainable fuels later. It will be a matter of public policy to determine when first-generation biofuels should be phased out. Let's hope the ag-conglomerates don't get their way on this one.

Posted by: BlackSun | August 14, 2007 at 03:05 PM

Re the post above about Professor Stephen A. Nelson, I would feel better if the correct term were used, kilocalories, or kcal. A gallon of gasoline has about 30,000 kcal of energy, while we eat about 2000-3000 kcal per day (some people quite a bit more these days!). It is reasonable that several gallons of gasoline's worth of energy is needed every day to sustain our high level Western lifestyle so the overall conclusion is reasonable that a quarter million kcal is the right ballpark for energy level.

But later in that message the poster went awry, saying that 8 liters of ethanol was 40 million calories. 8 liters is about 2 gallons and ethanol is somewhat lower energy that gasoline, so 40,000 kcal would be about right. Now technically, yes, that is 40 million calories but everywhere else when he said "calories" he meant "kcal" so it is inconsistent to suddenly switch.

However none of this verbiage goes to the main point of whether we can maintain our current per capita energy level based solely on solar power, or better, increase the worldwide per capita energy level to equal what it currently is in the West. Could we increase our energy usage to a quarter million kcal per day, or many times that?

The bottom line is that the total solar energy striking the Earth in one day is about 3 quintillion kcal, or over 10 trillion times more energy than we consume per capita today. Now obviously we can't use 100% of that energy, but still a factor of 10 trillion over what we use now makes me pretty comfortable that with appropriate technology, we can easily raise the entire world to an energy usage level equal to today's richest inhabitants, and probably quite a bit greater. We can definitely eat our cake, and burn it too.

Posted by: Hal | August 14, 2007 at 03:30 PM

Hal:

Are you sure that we eat as much as 2000 to 3000 (energy equivalent) Kilocalories per day per capita?

That is a lot of energy calories per capita, when 1 Kcal = the energy required to raise the temperature of 1 Kg of water by 1C or about 4180 joules.

I'm aware that the nutrition industry is using 1 calorie = 1 Kcal instead of 1000 calories = 1 Kilocalorie.

Prof. Stephen A. Nelson used calories i.e., 1.0 calorie = 4.18 joules, throughout his paper.

Posted by: | August 14, 2007 at 05:22 PM

Frankly, who cares if cereal exports from the EU will decline by 18% as a result of policies designed to foster biofuel production? Oil imports from Russia and OPEC will also decline, delivering improved energy supply security a lot more cheaply than sending troops overseas ever will. This is true even if only 10% of on-road fuel demand can be met this way.

Higher fuel prices are also not the end of the world, especially when compared to the cost of waging war over the remaining oil & gas. On the contrary, in the long run high prices actually reduce demand via improved efficiency. Plus, any projections made today are based on existing and anticipated near-term technology. If the demand is there, R&D funding will deliver incremental improvements, incl. technologies for growing suitable biomass on selected bodies of water or else in bioreactors featuring CO2 enrichment (located near industrial combustion processes). Again, much cheaper than weapons systems.

Even if none of this panned out and Europe had to stick with cereal feedstocks, a 3-6% increase in their wholesale price (as well as that of meat) over a 13-year period isn't going to cause the majority of consumers serious problems. Hardship cases will receive additional assistance, this is after all a continent of generous welfare systems. However, if politicians go overboard in their eagerness to foster a domestic biofuels industry, the unintended result could be massive feedstock imports from developing nations. This could cause staple foods to become very expensive for the poorest people on Earth, as has already happened in the case of corn in Mexico.

Germany's finance minister pulled the ripcord on overly generous tax breaks for biodiesel last year, upsetting long-term investment calculations by farmers and refiners. As a result, there is now a temporary biodiesel glut. Granted, the reason for reneging on the previous' governments ideologically motivated commitment was the hole it was burning in overall tax revenue, rather than any impact on food prices. The episode illustrates that the biofuel industry really needs stable externalities more than it needs generous subsidies.

Posted by: Rafael Seidl | August 14, 2007 at 06:05 PM

The fact that only 20 % of the required ethanol; and the overall world trade structure for ethanol, basically geared to primary local production no matter how inefficient (subsidized) that is and major duty barriers to keep out more efficient foreign alternatives (yes Brazil but also Thailand and other possible lesser developed world tropical sources that can SHAME. If this whole development process was really "green", while some relatively efficient portion of requirements (say 40-50 %) might be subsidized the rest would be imported free of blocking duty and the whole world would benefit accordingly.

Pleased to see that the usual food scare hyperbole is not voiced above, biofuels can be managed to avoid this, if you understand the productivity increases (real, actual ones not imagined or hoped for) in Brazil with the right policies and support in place this is clear.

Posted by: Ken Donnelly | August 14, 2007 at 06:54 PM

first sentence in comment above should read "The fact that only 20 % of the required ethanol is to be imported" etc.

Posted by: Ken Donnelly | August 14, 2007 at 06:56 PM

Reduce of cereal export from EU or USA will result in those depends on them seek for alternative. Example farmers with live stock feeding on maize will try to use local product like cassava as replacement. Therefore creating more localized product, and therefore in theory reduce the "total milage" of your chicken or beef.

Could be a good thing, thou the local will be hit hard by higher cost of living.

Posted by: rexis | August 14, 2007 at 07:12 PM

10 billion people is insane. Even 6 billion people is insane. We really need to stop thinking about how the` world will meet the needs of such a plague and start working on reducing the population and the challenges this task will bring to us. It must be clear to anyone with a jot of wisdom, most of us I hope, that there are too many of us, and that the advantages of reducing our population will many times outweigh the disadvantages.

Posted by: aussie paul | August 14, 2007 at 08:39 PM

If Europe was importing more ethanol from areas that can make it more cost efficiently and locally making more food of course it would be more efficient overall, i.e. more efficient to ship ethanol than food, subsidies not required, development of the other countries etc etc. etc. Again not saying some reasonably efficient local core production is unreasonable, just that assuming 70-80 % or more must be local no matter the relative efficiency, is crazy and that duty barriers to world ethanol trade are also crazy.

This applies to the US also. with such a large gasoline demand and still relatively small overall ethanol blend levels in gasoline(below 5 %), significant duty free imports could be accomodated, perhaps a volume level could be employed, and overall mandated blend ratios increased. Because the gasoline demand is so great taking off the $ 0.54 per USG secondary tariff would result in higher mandatable blend levels (if blend level was 6-10 % both higher cost domestic production (with blenders credit ideally going direct to the ethanol producers) and imports could be accomodated. Basically there is not enough world excess exportable production to meet US demands at higher blend levels and there is not enough possible corn production, especially without related real food price inflation to meet such higher levels. So the prohibitive import duty barrier is foolish.

Posted by: Ken Donnelly | August 14, 2007 at 09:33 PM

ET AL:
I believe all the so called energy problems we are witnessing today and those coming in the future are symptoms of the basic problem of overpopulation. The figures in this article point out that fact very well. You only need to see the amount of energy that one person consumes to see we are using up the resources of the planet faster than they can be replenished. We are running out of oil because most of the easy stuff has already been found and pumped. Each barrel of oil is becoming more costly to pump and requires an ever increasing amount of energy to bring chemical energy to the car's fuel tank. If you doubt this statement, consider the run we are making on the oil sands in Canada. Additionally, the greed system we have in place called the stock market was founded on the idea that each company has to make more and more money each quarter and God help the company that doesn't make its numbers for they will be severely punished by dropping stock prices. It is this system that drives our energy companies to compete aggresivly, often blind to good business ethics.

In time we may find ourselves limiting the birth rates and fighting for space. Perhaps its not the time to address the real problem so we will continue to nip at the edges of the problem and continue to treat the symptoms by inventing whatever is necessary to continue the lifestyle we know. PHEVs, BEVs and Sun-energies will help extend our lifestyle well into the future. But, burning liquid fuels in ineffecient ICEs will accelerate the time when we must address the problem.

Ever wonder why few people are beating the drums against overpopulation? Easy answer: any politician that raises the question is immediately savaged at the polls because of our religious beliefs...but alas, that's a whole other story.

Posted by: Lad | August 14, 2007 at 10:12 PM

While I agree that 10 billion is a truly scary number, if you drill down into the information here: http://esa.un.org/unpp/ you will find that fertility numbers are headed in the right direction in all but a few regions (including regions that have traditionally bred like rabbits). Our biggest problem at this stage is the ratio of people bellow child bearing age compared to those over.

Posted by: HenryP | August 15, 2007 at 04:59 AM

As 3rd world countries go 1st world, birth rate will drop, many first world countries already have birth rates below 2.1 (min need to break even with death). As the populations ages we better hope robots and AI come online to replace the shrinking worker population.

Posted by: | August 15, 2007 at 11:04 AM

"For the love of god, how many times do people have to restate the same thing we already know about the current methods of producing ethanol?.."

I second that.

Posted by: Ian Bruce | August 16, 2007 at 08:13 AM

10 billion people is insane. Even 6 billion people is insane.

Feel free to reduce this number. Remember, think globally, act (very) locally!

Posted by: Paul Dietz | August 17, 2007 at 12:26 PM

For latest stories and news on ethanol, biofuels and climate, please visit:
www.ethanol-news.de

Posted by: Marian | August 20, 2007 at 09:51 PM

what would be the price of corn if sold for biofuel.? and i'm intrested in this corn buisness

Posted by: Titans | August 24, 2007 at 01:08 AM

Keep corn for human & livestock consumption. Produce bio fuel using gen2 techniques or using crops that actually benefit the soil and environment such as Jatropha and Elephant grass. EU can afford to import bio fuel from sunnier climates!

Posted by: ecoangel | January 02, 2008 at 10:04 AM

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